1. Growth of Industrialization----1865 to 1900 Why? Factors in place Railroad industry

1. INDUSTRIAL GROWTH OF THE U.S. 1. Growth of Industrialization----1865 to 1900 • Why? Factors in place • Railroad industry • Distribution System • Symbol of growth • Government assists industry ---- 1860 to 1880 • laissez faire economy • Laws to promote industry: • Morrill Tariff of 1861 • National Banking Act of 1863 • Morrill Act of 1862 • Land grants to railroads • Rise of Industrialists or Entrepreneur • Andrew Carnegie----steel • John Rockefeller----oil Captains of Industry or Robber Barons

2. Cornelius Vanderbilt---railroad • New types of businesses • vertical integration • horizontal integration • created monopolies---”trusts” • philanthropists • Government regulates Business 1880 to 1900 • Robber Barons • Problem: monopolies eliminating competition • 1st US laws to regulate business • Interstate Commerce Act • Sherman Anti-Trust Act • Response of Industrialists • US govt. should not interfere with competition • defend laissez faire • Social Darwinism • 14th Amendment

3. Inventions and inventors • Thomas Edison-------Alexander Graham Bell • New stores • 2. Response to Industrial Growth • Rise of Labor Unions----Why? • 3 main labor unions • Strikes and labor disputes • Eugene Debs • Great Railroad Strike--1877 • Haymarket Riot--1886 • Homestead Strike--1892 • Pullman Strike--1894

4. ROBBER BARRONS robber • Extortion: Forced against your will • Rebates: discount or refund on “freight charges” • Drawbacks / Kickbacks:Standard Oil gave certain railroads all its shipping business if it agreed to charge Standard Oil 25% to 50% less than its competitors • Buyouts:Larger corporations forced smaller businesses to sell out • Congresswas “bought out” by the monopolies • Spies:Stealing your competitor's ideas Small businessescomplained “monopolies” eliminated fair competition

5. 1st LAWS TO REGULATE BIG BUSINESS State representatives voted into office by members of the Grange who in turn represented the interests of farmers and passed state laws regulating railroad prices in 18 states. Granger State Laws Supreme Court decision stating that states had the ability to regulate private property if it affected public interest. Munn v. Illinois(1876) Declared that it was unconstitutional for states to regulate interstate commerce. Showed need for Federal regulation of interstate commerce (RR!). Wabash Case(1886)

6. Granger Movement • In 1866 the Dept. of Agriculture sent Oliver H. Kelley on a tour of postbellum southern farms • Kelley decided to do something to help the isolated farmers • In 1867 he founded the Patrons of Husbandry (The Grange) • By 1874 membership was almost at 1.5 million • Initially to help with the isolation of the farmers the movement soon changed to become cooperatives for buying and selling crops • The Grangers then became involved in politics

7. Their main concern was the regulation of railroad rates and warehouse rates • Five states passed Granger Laws which challenged the power of the railroad and warehouse owners • In Munn v. Illinois (1877) the Supreme Court ruled that states had the right to regulate property in the interest of public good • Eventually the Granger movement lost its momentum and was replaced in 1875 by the Independent National party (Greenback party) – which emphasized the use of paper money • But in the 1880 the party declined and disappeared after 1884

8. Populist Party • Involved in the elections between 1892-1908 the won control of many state legislatures and Kansas even elected a Populist candidate to the Senate • In 1892 the Populist party met in Omaha to decide on a national platform and nominated James Weaver as their candidate • The platform was finance, transportation, land, a one-term presidency, and limiting immigration • They would become extremely important in gaining workers’ rights and pushing for soft currency

9. POPULIST'S REVOLT • 1860 to 1925 • William Jennings Bryan was a gifted speaker, lawyer, three-time presidential candidate, and devout Protestant. • Bryan made his career in Nebraska politics. • Served in the U.S. House of Representatives in 1890. • Defender of the small farmer and laborer, Bryan worked closely with the Populist Party.

10. POPULIST'S REVOLT • Bryan's efforts on behalf of farmers and laborers (the so-called "common" people) earned him the title the • "Great Commoner” • Ran for the presidency unsuccessfully in 3 elections as a Democrat. • Known for the • “Cross of Gold Speech”

11. POPULIST'S REVOLT

12. CROSS OF GOLD SPEECH • William Jennings Bryan's most well-known political speech delivered before the Democratic Convention in 1896. • Highlighted the Populist stance and his strong position on the issue of the "Gold-Standard." • Attacked the concept that gold was the only sound backing for currency.

13. CROSS OF GOLD SPEECH • Argued the “real” business men” were farmers, agricultural workers, miners and small town merchants. • Demonstrated the true "pioneer spirit" of America • These workers were all but ignored by a government that served the interests of big cities and large corporate enterprise.

14. CROSS OF GOLD SPEECH “They tell us that the great cities are in favor of the gold standard. We reply that our great cities rest upon our broad and great prairies”.

15. CROSS OF GOLD SPEECH “Burn down your cities and leave our farms, and your cities will spring up again as if by magic; but destroy our farms, and the grass will grow in the streets of every city of the country”.

16. CROSS OF GOLD SPEECH “You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold”

17. The Wizard of Oz by L. Frank Baum

18. 1964: Henry Littlefield’s Thesis?

19. a. The Cowardly Lion = William Jennings Bryan b. The Tin Woodsman = eastern industrial worker   c. The Scarecrow = farmer Wicked Witch of the East = Bankers Wicked Witch of the West = Bankers d. Dorothy and her "silver slippers" = the proposed silver standard e. The Yellow-Brick Road = the gold standard supported by financiers   f. The Wizard of Oz = President William McKinley g. Toto = a small, black dog

20. Wabash Railroad v. Illinois (1886) • Since the end of the war the federal government had examined the idea of regulating railroads • In the Wabash Railroad v. Illinois case the Supreme Court prohibited the states from regulating rates on interstate traffic • Cleveland determined to act and to control the railroads • Congress gave away millions of acres of land to railroad companies to encourage development until it was stopped by Cleveland in 1887 • By 1900 there were four other transcontinental lines

21. 1st LAWS TO REGULATE BIG BUSINESS These are the first laws to regulate industry and big business. • Congress passed Interstate Commerce Commission (ICC). • U.S. government regulated interstate trade within the country. • End railroad corruption of charging high prices to ship goods and Rockefeller’s illegal deals. • Rebates/kickbacks/drawbacks were illegal. • In 1890, Congress passed a law which made trusts/monopolies illegal or any business that prevented fair competition. Interstate Commerce Act(1887) ShermanAntitrust Act(1890) To regulate means the US Government would make laws to oversee, adjust, fine tune and correct the unfair business tactics in industry and big business. Not take over or control it because that would violate laissez faire.

22. Interstate Commerce Act (1887) • All freight charges on railroads had to be “reasonable and just” • Railroads were prohibited from granting special rates or favors, from manipulating the prices by forming pools, and from discriminating against individuals • The ICC was created by Cleveland as an independent regulatory commission • The ICC had five members who could investigate railroads and prosecute violators • Ultimately the commission had little power when forced to prosecute the big companies in court

23. ENTREPRENEUR • A person who organizes, operates, and assumes the risk for a business venture

24. “Robber Barons” Business leaders built their fortunes by stealing from the public. They drained the country of its natural resources. They persuaded public officials to interpret laws in their favor. They ruthlessly drove their competitors to ruin. They paid their workers meager wages and forced them to toil under dangerous and unhealthful conditions. “Captains of Industry” The business leaders served their nation in a positive way. They increased the supply of goods by building factories. They raised productivity and expanded markets. They created jobs that enabled many Americans to buy new goods and raise their standard of living. They also created museums, libraries, and universities, many of which still serve the public today. CAPTAINS OF INDUSTRY OR ROBBER BARONS

25. ANDREW CARNEGIE • Captain of Industry • Monopolized the steel industry • Rags to riches story---came from Scotland very poor. • Used scientific ideas (Bessemer Process) to develop a better way to produce steel and sell a quality a product for an inexpensive price. • Used Horizontal integration.

26. JOHN ROCKEFELLER • Captain of Industry • Came from a wealthy family • Bought a substitute during the Civil War. • Formed the first modern corporations in the oil industry Standard Oil • Was the first billionaire in the U.S. by 1900. • Used Vertical Integration and Horizontal Integration to gain a monopoly in the oil business.

27. CONRELIUS VANDERBILT • Formed a steamship company in 1829 • Dominated shipping along the Atlantic • 1849 established steamship that carried people from New York to San Francisco in Gold Rush days • Leading U.S. steamship owner, nicknamed “The Commodore” • Gained control of the Hudson River Railroad

28. CONRELIUS VANDERBILT • After Civil War Vanderbilt bought most railroad lines from New York to Chicago • 1877, controlled 4,500 miles of railroads • Worth over $100 million • Philanthropist?--donated $1 million to Vanderbilt University • Philanthropy - “The effort of an individual or organization to increase the well-being of humankind, as by charitable aid or donations.”

29. Cartoon Carnegie ANDREW CARNEGIE • Philanthropist? • Gave millions to colleges and libraries. • It was the sacred duty of the wealthy to give back to society who has given to him. • Stressed education as a means to better one’s self. • Carnegie Hall

30. GOSPEL OF WEALTH

31. Gospel of Wealth • Capitalists used Social Darwinism to justify their success • Social Darwinism also coincided with the ideas of Adam Smith, especially concerning the laws of supply & demand and free markets • Carnegie wrote The Gospel of Wealth (1901) which claimed wealthy people have power but also an obligation to society • Baptist preacher Russell H. Conwell preached about “Acres of Diamonds” – everyone who wanted to be rich had the opportunity • Horatio Alger’s “Luck and Pluck” manual pushed the idea of rags-to-riches at the time to encourage everyone (think Jackson)

32. “On Wealth” • The Anglo-Saxon race is superior. • “Gospel of Wealth” (1889). • Inequality is inevitable and good. • Wealthy should act as “trustees” for their “poorer brethren.” (think back to breadwinner shame, self-reliance, rugged indy.) Andrew Carnegie

33. Rockefeller JOHN ROCKEFELLER • Philanthropist • Gave millions of his money to hospitals and colleges. • University of Chicago • Spellman College • National Parks • United Nations • Williamsburg • Cancer Research

34. CONRELIUS VANDERBILT • Worth over $100 million • Philanthropistdonated $1 million to Vanderbilt University

35. Captains of industry? Or robber barons?

36. Cartoon Rockefeller JOHN ROCKEFELLER • Controlled the railroad by forcing them to pay him rebatesbecause of the volume of business he gave them. • Was called “Rock a Fellow” by many • Ruthless business man: “Pay no man a profit”

37. Rockefeller/Control Govt Rockefeller was so wealthy, he dictated to the U.S. Government to protect big business---- laissez faire

38. Rockefeller would be hated by many because he had too much control over the oil industry and the government as viewed by the common man-----Some believed he was corrupt because he took away the right to compete---free enterprise

39. Trusts control govt Big business, monopolies controlled Congress through bribery. This is corruption

40. “History repeats itself-----The Robber Barons of the Middle Ages and the Robber Barons of Today…..”

41. Social Darwinism • British economist, Herbert Spencer. • Advocate of laissez-faire. • Adapted Darwin’s ideas from the “Origin of Species” to humans. • Belief that there was a natural upper class and lower class. • “Survival of the fittest”

42. Social Darwinism Belief that in the economic world the strongest companies will survive “The growth of a large business is merely a survival of the fittest.” J. Rockefeller

43. Social Darwinism • Social Darwinists believed that companies struggled for survival in the economic world and the government should not tamper with this natural process. • The fittest business leaders would survive and would improve society. • Belief that hard work and wealth showed God’s approval and those that were poor were lazy and naturally a lower class.

44. SOCIAL DARWINISM 1. All living things have always competed for survival. Survival of the fittest. 2. All living things have evolved over millions of years as a result of genetic changes. 3. Some plants and animals developed traits that helped them survive. 1. Every human activity individuals compete for success. 2. The unfit or incompetent lose and the strong or competent win. 3. These winners make up a natural upper class. 4. Hard worked paid off, and lazy were inferior.

45. 14th AMENDMENT 14th amend Rights of Citizens “All persons born in the U.S. are citizens of this country and the state they reside in. No state shall make or enforce any law which deprives any person of life, liberty, or property, without due process of law, nor deny to any person with its jurisdiction to the equal protection of the laws.” Industrialists would use the 14th Amendment as a way to defend a corporation from the Sherman Anti-Trust Act.

46. Picture: Workers vs Owner INDUSTRALIZATION

47. Picture: Workers vs Owner WORKER VS EMPLOYER “The old familiar relations between employer and employee were passing. A few generations before, the boss had known every man in his shop. He called his men by their first names, asked about the family and swapped jokes and stories with them. Today, you have large factories, the personal touch is gone!” Theodore Roosevelt “IMPERSONALIZATION”

48. INDUSTRALIZATION • Poor working conditions • Unfriendliness/impersonalization • Immigrants taking jobs • Decrease work day • Machines replacing workers • Child labor • Job security

49. WORKING FAMILIES Rarely did the government provide public assistance, and unemployment insurance didn’t exist. The theory of Social Darwinism held that poverty resulted from personal weakness. Many thought that offering relief to the unemployed would encourage idleness. • In the 1880s, children made up more than 5 percent of the industrial labor force. • Children often left school at the age of 12 or 13 to work. • Girls sometimes took factory jobs so that their brothers could stay in school. • If an adult became too ill to work, children as young as 6 or 7 had to work.

50. THE WORK ENVIRONMENT Division of Labor • Some owners viewed workers as parts of the machinery. • Unlike smaller and older businesses, most owners never interacted with workers. • impersonalization Work Environment • Factory workers worked by the clock. • Workers could be fired for being late, talking, or refusing to do a task. • Workplaces were not safe. • Children performed unsafe work and worked in dangerously unhealthy conditions. • In the 1890s and early 1900s states began legislating child labor.